Registration No. 33-__________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
__________
CT COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
NORTH CAROLINA 56-1837282
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
68 CABARRUS AVENUE, EAST
POST OFFICE BOX 227
CONCORD, NORTH CAROLINA 28025
(Address of Principal Executive Offices)
__________
CT COMMUNICATIONS, INC. 1995 EMPLOYEE STOCK PURCHASE PLAN
(Full title of the Plan)
__________
MICHAEL R. COLTRANE
PRESIDENT AND CEO
CT COMMUNICATIONS, INC,
68 CABARRUS AVENUE,EAST
POST OFFICE BOX 227
CONCORD, NORTH CAROLINA 28025
(Name and address of agent for service)
(704) 788-0214
(Telephone number, including area code, of agent for service)
__________
COPY TO:
R. DOUGLAS HARMON
SMITH HELMS MULLISS & MOORE, L.L.P.
POST OFFICE BOX 31247
CHARLOTTE, NORTH CAROLINA 28231
__________
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of
this Registration Statement.
__________
CALCULATION OF REGISTRATION FEE
Proposed Maximum
Title of each Class of Amount to be Offering
Securities to be Registered Registered Price Per Share (1)
- --------------------------- ------------ -------------------
Class B Nonvoting 2,500 $251
Common Stock shares
$50.00 par value
Proposed Maximum Amount of
Title of each Class of Aggregate Registration
Securities to be Registered Offering Price (1) Fee
- --------------------------- ------------------ ------------
Class B Nonvoting $627,500 $216.36
Common Stock
$50.00 par value
(1) Estimated solely for the purpose of calculating the
registration fee and computed according to Rule 457(h) under the
Securities Act of 1933, as amended, based on the price of the
Common Stock of which options granted pursuant to the Plan may be
exercised.
<PAGE>
PART I. INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The documents constituting the Prospectus of CT
Communications, Inc. (the "Registrant") with respect to this
Registration Statement in accordance with Rule 428 promulgated
pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), are kept on file at the offices of the
Registrant. The Registrant will provide without charge to
employees, on the written or oral request of any such person, a
copy of any or all of the documents constituting the Prospectus.
Written requests for such copies should be directed to the
Treasurer, CT Communications, Inc., 68 Cabarrus Avenue, East,
Post Office Box 227, Concord, North Carolina 28025. Telephone
requests may be directed to (704) 788-0244.
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Registrant with the
Securities and Exchange Commission (the "Commission") are
incorporated by reference herein and in the Prospectus
constituting a part of this Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for
the year ended December 31, 1994, filed pursuant to Section 13 of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act");
(b) The Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1995, filed pursuant to Section 13 of
the Exchange Act; and
(c) The description of the Registrant's Common Stock,
$50 par value, contained in its Registration Statement filed
under the Exchange Act and all amendments and reports filed for
the purpose of updating such description, including the
Registrant's Definitive Proxy Statement filed with the Commission
on September 21, 1993.
All documents filed by the Registrant with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), subsequent
to the effectiveness of this Registration Statement and prior to
the filing of a post-effective amendment hereto, which either
indicates that all securities offered hereto have been sold or
deregisters all securities then remaining unsold shall be deemed
to be incorporated by reference in this Registration Statement
and the Prospectus and to be a part hereof and thereof from the
date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference
herein or therein shall be deemed to be modified or superseded
for purposes of this Registration Statement and the Prospectus to
the extent that a statement contained herein or therein or in any
other subsequently filed document which also is or is deemed to
be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute
a part of this Registration Statement or the Prospectus.
The Registrant will provide without charge to each person to
whom the Prospectus constituting a part of this Registration
Statement is delivered, on the written or oral request of any
such person, a copy of any or all of the documents incorporated
herein and in the Prospectus by reference (other than exhibits to
such documents which are not specifically incorporated by
reference in such documents). Written requests for such copies
should be directed to the Treasurer, CT Communications, Inc. 68
Cabarrus Avenue, East, Post Office 227, Concord, North Carolina
28025. Telephone requests may be directed to (704) 788-0244.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
There are no provisions in the Registrant's Articles of
Incorporation, and no contracts between the Registrant and its
directors and officers nor resolutions adopted by the Registrant,
relating to indemnification. The Registrant's Articles of
Incorporation prevent the recovery by the Registrant of monetary
damages against its directors. However, in accordance with the
provisions of the North Carolina Business Corporation Act (the
"Act"), the Registrant's Bylaws provide that, in addition to the
indemnification of directors and officers otherwise provided by
the Act, the Registrant shall, under certain circumstances,
indemnify its directors, executive officers and certain other
designated officers against any and all liability and litigation
expense, including reasonable attorneys' fees, arising out of
their status or activities as directors and officers, except for
liability or litigation expense incurred on account of activities
that were at the time known or reasonably should have been known
by such director or officer to be clearly in conflict with the
best interests of the Registrant. Pursuant to such bylaw and as
authorized by statute, the Registrant maintains insurance on
behalf of its directors and officers against liability asserted
against such persons in such capacity whether or not such
director or officers have the right to indemnification pursuant
to the bylaw or otherwise.
In addition to the above-described provisions, Sections
55-8-50 through 55-8-58 of the Act contain provisions prescribing
the extent to which directors and officers shall or may be
indemnified. Section 55-8-51 of the Act permits a corporation,
with certain exceptions, to indemnify a present or former
director against liability if (i) he conducted himself in good
faith, (ii) he reasonably believed (x) that his conduct in his
official capacity with the corporation was in its best interests
and (y) in all other cases his conduct was at least not opposed
to the corporation's best interest and (iii) in the case of any
criminal proceeding, he had no reasonable cause to believe his
conduct was unlawful. A corporation may not indemnify a director
in connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation or in connection with a proceeding charging improper
personal benefit to him in which he was adjudged liable on such
basis. The above standard of conduct is determined by the Board
of Directors, or a committee or special legal counsel or the
shareholders as prescribed in Section 55-8-55.
Sections 55-8-52 and 55-8-56 of the Act require a
corporation to indemnify a director or officer in the defense of
any proceeding to which he was a party because of his capacity as
a director or officer against reasonable expenses when he is
wholly successful in his defense, unless the articles of
incorporation provide otherwise. Upon application, the court may
order indemnification of the director or officer if he is
adjudged fairly and reasonably so entitled under Section 55-8-54.
Section 55-8-56 allows a corporation to indemnify and advance
expenses to an officer, employee or agent who is not a director
to the same extent as a director or as otherwise set forth in the
corporation's articles of incorporation or bylaws or by
resolution of the Board of Directors.
The foregoing is only a general summary of certain aspects
of North Carolina law dealing with indemnification of directors
and officers and does not purport to be complete. It is
qualified in its entirety by reference to the relevant statutes
which contain detailed specific provisions regarding the
circumstances under which and the person for whose benefit
indemnification shall or may be made and accordingly are set
forth in Exhibit 99.2 hereto and incorporated herein by
reference.
ITEM 8. EXHIBITS.
The following exhibits are filed with or incorporated by
reference in this Registration Statement.
EXHIBIT NO.
(PER EXHIBIT
TABLES IN
ITEM 601 OF
REGULATION S-K) DESCRIPTION OF EXHIBIT
- ---------------- ----------------------
4.1 Articles of Incorporation of the Registrant,
incorporated by reference to Registrant's
Annual Report on Form 10-K for the fiscal
year ended December 31, 1993, dated March 29,
1994.
4.2 Bylaws of the Registrant, incorporated by
reference to Registrant's Annual Report on
10-K for the fiscal year ended December 31,
1993, dated March 29, 1994.
5.1 Opinion of Smith Helms Mulliss & Moore,
L.L.P., as to legality of securities to be
registered.
23.1 Consent of Smith Helms Mulliss & Moore,
L.L.P. (included in Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP, independent
certified public accountants.
24.1 Power of Attorney (included in signature
page).
99.1 1995 Employee Stock Purchase Plan.
99.2 Provisions of North Carolina law relating to
indemnification.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the Registration
Statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in
the Registration Statement or any material change to such
information in the Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the Registration Statement is on Form S-3 or Form
S-8, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13
or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
shall be deemed to be a new Registration Statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be
deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of
the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
<PAGE>
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the
Securities Act of 1933, the Registrant certifies that it has
reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Concord,
North Carolina, on May 18, 1995.
CT COMMUNICATIONS, INC.
By: /S/ MICHAEL R. COLTRANE
Michael R. Coltrane
President and Chief Executive Officer
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each individual whose
signature appears below constitutes and appoints Michael R.
Coltrane and Roy W. Long, and each of them acting individually,
his true and lawful attorneys-in-fact and agents with full power
of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this
registration statement, and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the
Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them acting
individually, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and
about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, and each of them acting
individually, or his substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933
this Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
/S/MICHAEL R. COLTRANE President, Chief Executive May 18, 1995
Michael R. Coltrane Officer and Director
(Principal Executive Officer)
/S/L.D. COLTRANE III Chairman of the Board May 18, 1995
L.D. Coltrane III and Director
/S/ROY W. LONG Vice President, Treasurer May 18, 1995
Roy W. Long and Chief Financial
Officer (Principal Financial
and Principal Accounting
Officer)
/S JOHN R. BOGER, JR. Director May 18, 1995
John R. Boger, Jr.
/S/PHIL W. WIDENHOUSE Director May 18, 1995
Phil W. Widenhouse
/S/JERRY H. MCCLELLAN Executive Vice May 22, 1995
Jerry H. McClellan President, General
Plant Manager, Secretary
and Director
/S/BETTY GAY BIVENS Director May 19, 1995
Betty Gay Bivens
/S/BEN F. MYNATT Director May 19, 1995
Ben F. Mynatt
<PAGE>
EXHIBIT INDEX
EXHIBIT NO.
(PER EXHIBIT
TABLES IN
ITEM 601 OF SEQUENTIAL
REGULATION S-K) DESCRIPTION OF EXHIBIT PAGE NO.
- -------------- ---------------------- ----------
4.1 Articles of Incorporation of the
Registrant, incorporated by reference
to Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993, dated March 29,
1994.
4.2 Bylaws of the Registrant, incorporated
by reference to Registrant's Annual
Report on 10-K for the fiscal year
ended December 31, 1993, dated March
29, 1994.
5.1 Opinion of Smith Helms Mulliss & Moore,
L.L.P., as to legality of securities to
be registered.
23.1 Consent of Smith Helms Mulliss & Moore,
L.L.P. (included in Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP,
independent certified public accountants.
24.1 Power of Attorney (included in signature
page).
99.1 1995 Employee Stock Purchase Plan.
99.2 Provisions of North Carolina law
relating to indemnification.
SMITH HELMS MULLISS & MOORE, L.L.P.
P. O. Box 31247
Charlotte, North Carolina 28231
Telephone: (704) 343-2000
May 26, 1995
CT Communications, Inc.
68 Cabarrus Avenue, East
P. O. Box 227
Concord, North Carolina 28025
Re: Registration Statement on Form S-8 Filed May 26, 1995 -
5,000 Shares of Class B Nonvoting Common Stock to be Issued
Pursuant to 1995 Comprehensive Stock Option Plan
Gentlemen:
In connection with the possible offering and sale from time
to time of all or a portion of 5,000 shares of the Class B
Nonvoting Common Stock, $50.00 par value per share, of CT
Communications, Inc. (the "Shares"), upon the terms and
conditions set forth in the Registration Statement on Form S-8
(the "Registration Statement") filed on May 26, 1995 by the
registrant with the Securities and Exchange Commission under the
Securities Act of 1933, we are of the opinion that when (a) the
Registration Statement shall become effective and (b) the Shares
have been sold upon the terms and conditions set forth in the
Registration Statement, the Shares will be validly authorized and
legally issued, fully paid and non-assessable.
We hereby consent to the filing of a copy of this opinion as
Exhibit 5.1 of the Registration Statement.
Very truly yours,
SMITH HELMS MULLISS & MOORE, L.L.P.<PAGE>
Independent Auditors' Consent
The Board of Directors
CT Communications, Inc.:
We consent to incorporation by reference in the registration
statement on Form S-8 pertaining to the CT Communications, Inc.
1995 Employee Stock Purchase Plan of our report dated March 3,
1995, related to the consolidated balance sheets as of December
31, 1994 and 1993, and the related consolidated statements of
income, retained earnings, and cash flows for each of the years
in the three-year period ended December 31, 1994, and the
related financial statement schedules which report appears in
the December 31, 1994 annual report on Form 10-K of CT
Communications, Inc.
As discussed in Note 1 to the consolidated financial statements,
the Company changed its method of accounting for investments as
of Januay 1, 1994 to adopt the provisions of its Financial
Accounting Standards Board's Statement of Financial Accounting
Standards (SFAS) No. 115, "Accounting for Certain Investments in
Debt and Equity Securities." As discussed in Note 1, the Company
changed its method of accounting for income taxes on January 1,
1993 to adopt the provisions of the Financial Accounting
Standards Board's SFAS No. 109, "Accounting for Income Taxes."
KPMG PEAT MARWICK LLP
Charlotte, North Carolina
May 25, 1995
CT COMMUNICATIONS, INC.
1995 EMPLOYEE STOCK PURCHASE PLAN
ARTICLE I
PURPOSES
This CT Communications, Inc. 1995 Employee Stock Purchase
Plan (hereinafter called the "Plan") is intended to be an
employment incentive and to encourage stock ownership by all
eligible employees, including officers, of CT Communications,
Inc. (hereinafter called the "Corporation") and its subsidiary
corporations (the "Subsidiaries"), as that term is defined in
Section 424(f) of the Internal Revenue Code of 1986, as now in force or
hereafter amended (the "Code"), in order to increase their
proprietary interest in the Corporation's success and to
encourage them to remain in the employ of the Corporation or a
Subsidiary. It is not intended that options issued pursuant to
this Plan (hereinafter called "Options") shall constitute options
within the meaning of Code Section 423.
ARTICLE II
ADMINISTRATION
The Plan shall be administered by the Compensation Committee
of the Board of Directors of the Corporation (the "Committee").
No member of the Board of Directors who is not otherwise employed
by the Corporation shall be eligible to receive an Option. No
director who is or within the preceding year has been eligible to
receive an Option may serve as a member of the Committee.
Subject to the provisions of the Plan, the Committee may, from
time to time, prescribe rules and regulations for the
administration of the Plan and may decide questions which may
arise with respect to the interpretation or application of said
Plan.
ARTICLE III
ELIGIBILITY
Employees of the Corporation and of its Subsidiaries
(including officers) may be granted as of a date to be determined
by the Board of Directors (the "Option Date"), but in no instance
more than twelve (12) months after the shareholders of the
Corporation have approved the Plan, an Option under this Plan to
purchase the Corporation's authorized but unissued $50.00 Par
Value Class B Nonvoting Common Stock (herein called "Common
Stock").
ARTICLE IV
STOCK
The stock subject to the Options to be issued hereunder
shall be the Corporation's Common Stock. The maximum number of
such shares to be issued upon the exercise of the Options hereby
granted shall be an aggregate of 2,500 shares.
An eligible employee (hereinafter called "Optionee") shall
receive an Option to purchase a number of shares of Common Stock
to be determined in the sole discretion of the Committee.
Payment for Common Stock purchased under the Option shall be
made pursuant to Article V(C).
ARTICLE V
TERMS AND CONDITIONS OF OPTIONS
Options granted hereunder shall be evidenced by a Notice of
the Grant of an Option to each Optionee, which notice shall: (i)
be in such form as the Board of Directors shall determine; (ii)
incorporate, by reference, the terms and provisions of this Plan;
and (iii) be issued to each Optionee at least two weeks prior to
the Exercise Date (as defined below).
Such Options shall be subject to the following terms and
conditions:
A. OPTION PERIOD. Each Option granted hereunder shall be
exercisable for a term to be established by the Committee (the
"Option Period") which shall end on a date after which the Option
shall lapse and become null and void (the "Exercise Date").
B OPTION PRICE. The price of shares purchased under any
Option issued hereunder (the "Option Price") shall be an amount
equal to the fair market value of the Common Stock on the
Exercise Date but not less than the par value of such stock.
"Fair market value" as of a given date shall mean, for purposes
of this Plan, the value of a share of Common Stock in the most
recent prior quarterly appraisal provided by the Corporation's
appraisers. In making such determination, the Board of Directors
shall instruct the Corporation's appraisers to consider the
financial condition of the Corporation and its recent operating
results, values of publicly-traded securities of other financial
institutions giving effect to the relative book values and
earnings of such institutions and the lack of liquidity of the
Corporation's shares, and such other factors as the Board in its
discretion deems relevant.
C ELECTED SHARES. Each Optionee shall notify the
Corporation, in the manner described in subsection (F) and on
such forms as shall be provided by the Corporation, of the number
of shares which the Optionee wishes, which election may be for
either all or any part of the shares subject to the Option (such
shares, so elected, shall be hereinafter called the "Elected
Shares").
The Optionee may elect to pay the Corporation the fair
market value of the Common Stock as described in Section F below
by making full payment for the fair market value of the Elected
Shares to the Corporation by the Exercise Date. Alternatively,
the Optionee may enter into a promissory note (the "Note") by the
Exercise Date (as described in subsection (D)) to facilitate
payment to the Corporation of the fair market value of the
Elected Shares.
D. NOTE. The Corporation shall make available to each
Optionee an alternative means of exercising an Option as
described in this subsection (D). Before the Exercise Date, the
Optionee and the Corporation may enter into a Note for a period
not to exceed twenty-four (24) months, such Note accruing simple
interest at the rate of six percent (6%) per annum, computed on a
365 day basis, on the amount due on the Note. The Note will be
in a principal amount equal to the fair market value of the
Elected Shares for which the Optionee does not tender payment by
the Exercise Date, and shall be secured by Elected Shares
purchased under the Option and held by the Corporation as
described in subsection (K). Payments on the Note will be made
from the Optionee's salary on a payroll deduction basis and all
amounts withheld shall be exclusively applied to the retirement
of the Note.
E. DATE BY WHICH OPTION SHALL BE EXERCISED. Except as
provided in subsections (H) and (I), each Option which is
exercised shall be exercised before the Exercise Date.
F. MANNER OF EXERCISING OPTION. Except as provided in
subsections (H) and (I), each Optionee shall, on such forms as
shall be provided by the Corporation, at least three (3) business
days prior to the Exercise Date, notify the Corporation of the
Optionee's election either to: (i) exercise the Option to
purchase all or any part of the Elected Shares by immediate cash
payment; (ii) exercise the Option to purchase all or any part of
the Elected Shares by entering into a Note for payment of the
Option Price and secured by the Elected Shares; (iii) any
combination of (i) or (ii); or, (iv) decline to so exercise the
Option, which election, in all events, shall be effective as of
said Exercise Date.
In the event the Optionee so exercises the Option by payment
of cash, the Optionee shall tender to the Corporation all
necessary funds as may be necessary to purchase all or any part
of the Optionee's Elected Shares.
In the event that the Optionee enters into a Note under
subsection (D), salary withholding shall begin immediately and
continue until the Note is paid in full.
Should the Optionee fail to deliver the notification form
referred to in this subsection (F), such failure shall be deemed
an election by said Optionee to decline to exercise the Option.
G. TERMINATION OF OPTION. An Optionee may at any time on
or before the Exercise Date terminate the Option in its entirety
by written notice of such termination delivered in the manner set
forth in Article X hereof. Such termination shall become
effective upon receipt of such notice by the Corporation. Upon
such termination, the Note will become due pursuant to its terms,
and all further rights and privileges of Optionee granted
pursuant to this Plan and the Option granted hereunder shall be
terminated.
H. TERMINATION OF EMPLOYMENT. In the event that an
Optionee's employment by the Corporation or a Subsidiary is
terminated other than by retirement with the consent of the
Corporation, medical disability (determined in accordance with
the Corporation's long term disability plan then in effect) or by
death, all rights and privileges of Optionee granted pursuant to
the Plan and of any Option granted hereunder shall terminate,
except that any obligations arising under the Note(s) shall
continue under the terms of the Note(s). If any termination of
employment is due to retirement with the consent of the
Corporation, the Optionee shall have the right within two (2)
business days prior to the Exercise Date, to exercise the Option
to purchase all or any part of the Optionee's shares. If the
Optionee shall become medically disabled or die while in the
employment of the Corporation or any Subsidiary of the
Corporation before the Exercise Date, the Optionee's estate,
personal representative, or beneficiary shall have the right, at
any time, within two (2) business days prior to the Exercise
Date, to exercise the employee's Option to purchase all or any
part of the shares. Options exercised pursuant to the terms of
this subsection (H) may be exercised (during the specified times)
as to all or any part of the shares by written notice delivered
in the manner set forth in Article X hereof and tendering with
such notice payment of any or all funds, and shall be deemed
exercised as of the date such notice is delivered. Failure to
deliver such notice and payment within the time provided shall be
deemed an election not to exercise the Option, which shall
terminate.
Retirement of an Optionee at the Optionee's Normal
Retirement Date in accordance with the provisions of any
Retirement Plan adopted by the Corporation or by any Subsidiary
shall be deemed to be a retirement with the consent of the
Corporation. Whether any other terminations of employment
(either at an Optional Retirement Date in accordance with the
provision of any such Retirement Plan or otherwise) are to be
considered retirements with the consent of the Corporation and
whether authorized leaves of absence or absences on military or
government service or for other reasons shall constitute a
termination of employment for the purposes of the Plan, shall be
determined by the Committee, the determination of which shall be
final and conclusive. Employment by the Corporation or any
Subsidiary shall be deemed to be continuous and not to terminate
during any uninterrupted period in which an employee is in the
employment of the Corporation or any Subsidiary, but only if and
so long, in the case of employment by a Subsidiary, as employment
by such Subsidiary will, under the applicable provisions of the
Code as then in effect, result in the same tax treatment as would
be accorded if such Optionee were an employee of the Corporation.
I. The grant of an Option pursuant to this Plan shall not
affect in any way the right or power of the Corporation to make
adjustments, reclassifications, reorganizations, or changes of
its capital or business structure, or to merge or consolidate, or
to dissolve, liquidate or sell, or transfer all or any part of
the business or assets.
J. ASSIGNABILITY. No Option granted hereunder shall be
assignable or transferable except by will or by the laws of
descent and distribution, and shall be exercisable, during the
lifetime of Optionee, only by said Optionee.
K. RIGHTS AS A SHAREHOLDER. An Optionee shall have all
rights as a shareholder with respect to shares purchased pursuant
to the Options to be granted hereunder after full payment has
been made for such shares and a stock certificate for such shares
has been actually issued to said Optionee, except that Elected
Shares which are security for a Note executed under subsection
(D) shall be held by the Corporation until the Note is paid in
full. No adjustment will be made for dividends or other rights
for which the record date is prior to the date of such issuance.
L. REGISTRATION. Each Option under the Plan shall be
granted on the condition that a registration statement under the
Securities Act of 1933, as amended, with respect to the Common
Stock subject to such Option has become effective and a copy of
the Prospectus has been delivered to the Optionee.
ARTICLE VI.
TERMINATION OF PLAN
The Plan will terminate on the first to occur of the
granting of all Options authorized under the Plan or June 30,
1997.
ARTICLE VII.
AMENDMENTS
The Committee may, from time to time, alter, amend, suspend,
or discontinue the Plan at any time without notice, provided that
no Optionee's existing rights are adversely affected thereby;
provided further, upon any such amendment or modification, all
Optionees shall continue to have the same rights and privileges
as other Optionees (except as otherwise provided for in Article
IV hereof); and provided further, that no such amendment of the
Plan shall, except as provided in subsection (i) of Article V
hereof: (a) change the formula by which the price for which the
Common Stock shall be sold is determined; or (b) increase the
maximum number of shares which any Optionee may purchase.
ARTICLE VIII.
APPLICATION OF FUNDS
The proceeds received by the Corporation from the sale of
its Common Stock pursuant to Options granted under this Plan,
except as otherwise provided herein, will be used for general
corporate purposes.
ARTICLE IX.
NO OBLIGATION TO PURCHASE SHARES
The granting of an Option pursuant to this Plan shall impose
no obligation upon the Optionee to purchase any shares covered by
such Option.
ARTICLE X.
NOTICES
Any notice which the Corporation or Optionee may be required
or permitted to give to each other shall be in writing and shall
be deemed given when delivered personally or deposited in the
U.S. Mail, first class postage prepaid, addressed as follows:
Secretary, CT Communications, Inc., 68 Cabarrus Avenue, Post
Office Box 227, Concord, North Carolina 28026-0227, or as such
other address as the Corporation, by notice to the Optionee, may
designate in writing from time to time; to the Optionee, at the
address shown on the records of the Corporation, or at such other
address as the Optionee, by notice to the Corporation, may
designate in writing from time to time.
ARTICLE XI.
THE RIGHT OF THE CORPORATION TO TERMINATE EMPLOYMENT
Nothing contained in the Plan or in any option granted
pursuant to the Plan shall confer upon any Optionee any right to
be continued in the employment of the Corporation or one of its
Subsidiaries, or shall interfere in any way with the right of the
Company or any of its Subsidiaries, as the case may be, to
terminate his employment at any time for any reason.
ARTICLE XII.
EFFECTIVENESS OF THE PLAN
The Plan shall become effective only if:
A. The Plan shall have been adopted by the Board of
Directors of the Corporation; and
B. The Plan shall have been approved by the affirmative
vote of the holders of at least a majority of shares of Class A
Common Stock voted at the shareholders' meeting at which the Plan
is considered.
<PAGE>
PROVISIONS OF NORTH CAROLINA BUSINESS CORPORATION ACT
REGARDING INDEMNIFICATION
"Section 55-8-50. Policy statement and definitions.
(a) It is the public policy of this State to enable
corporations organized under this Chapter to attract and maintain
responsible, qualified directors, officers, employees and agents,
and, to that end, to permit corporations organized under this
Chapter to allocate the risk of personal liability of directors,
officers, employees and agents through indemnification and
insurance as authorized in this Part.
(b) Definitions in this Part:
(1) 'Corporation' includes any domestic or foreign
corporation absorbed in a merger which, if its
separate existence had continued, would have had
the obligation or power to indemnify its
directors, officers, employees, or agents, so that
a person who would have been entitled to receive
or request indemnification from such corporation
if its separate existence had continued shall
stand in the same position under this Part with
respect to the surviving corporation.
(2) 'Director' means an individual who is or was a
director of a corporation or an individual who,
while a director of a corporation, is or was
serving at the corporation's request as a
director, officer, partner, trustee, employee, or
agent of another foreign or domestic corporation,
partnership, joint venture, trust, employee
benefit plan, or other enterprise. A director is
considered to be serving an employee benefit plan
at the corporation's request if his duties to the
corporation also impose duties on, or otherwise
involve services by, him to the plan or to
participants in or beneficiaries of the plan.
'Director' includes, unless the context requires
otherwise, the estate or personal representative
of a director.
(3) 'Expenses' means expenses of every kind incurred
in defending a proceeding, including counsel fees.
(4) 'Liability' means the obligation to pay a
judgment, settlement, penalty, fine (including an
excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred
with respect to a proceeding.
(4a) 'Officer', 'employee', or 'agent' includes, unless
context requires otherwise, the estate or personal
representative of a person who acted in that
capacity.
(5) 'Official capacity' means: (i) when used with
respect to a director, the office of director in a
corporation; and (ii) when used with respect to an
individual other than a director, as contemplated
in G.S. 55-8-56, the office in a corporation held
by the officer or the employment or agency
relationship undertaken by the employee or agent
on behalf of the corporation. 'Official capacity'
does not include service for any other foreign or
domestic corporation or any partnership, joint
venture, trust, employee benefit plan, or other
enterprise.
(6) 'Party' includes an individual who was, is, or is
threatened to be made a named defendant or
respondent in a proceeding.
(7) 'Proceeding' means any threatened, pending, or
completed action, suit, or proceeding, whether
civil, criminal, administrative, or investigative
and whether formal or informal.
Section 55-8-51. Authority to indemnify.
(a) Except as provided in subsection (d), a corporation may
indemnify an individual made a party to a proceeding because he
is or was a director against liability incurred in the proceeding
if:
(1) He conducted himself in good faith; and
(2) He reasonably believed (i) in the case of conduct
in his official capacity with the corporation,
that his conduct was in its best interests; and
(ii) in all other cases, that his conduct was at
least not opposed to its best interests; and
(3) In the case of any criminal proceeding, he had no
reasonable cause to believe his conduct was
unlawful.
(b) A director's conduct with respect to an employee
benefit plan for a purpose he reasonably believed to be in the
interests of the participants in and beneficiaries of the plan is
conduct that satisfies the requirement of subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order,
settlement, conviction, or upon a plea of no contest or its
equivalent is not, of itself, determinative that the director did
not meet the standard of conduct described in this section.
(d) A corporation may not indemnify a director under this
section:
(1) In connection with a proceeding by or in the right
of the corporation in which the director was
adjudged liable to the corporation; or
(2) In connection with any other proceeding charging
improper personal benefit to him, whether or not
involving action in his official capacity, in
which he was adjudged liable on the basis that
personal benefit was improperly received by him.
(e) Indemnification permitted under this section in
connection with a proceeding by or in the right of the
corporation that is concluded without a final adjudication on the
issue of liability is limited to reasonable expenses incurred in
connection with the proceeding.
(f) The authorization, approval or favorable recommendation
by the board of directors of a corporation of indemnification, as
permitted by this section, shall not be deemed an act or
corporate transaction in which a director has a conflict of
interest, and no such indemnification shall be void or voidable
on such ground.
Section 55-8-52. Mandatory indemnification.
Unless limited by its articles of incorporation, a
corporation shall indemnify a director who was wholly successful,
on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the
corporation against reasonable expenses incurred by him in
connection with the proceeding.
Section 55-8-53. Advance for expenses.
Expenses incurred by a director in defending a proceeding
may be paid by the corporation in advance of the final
disposition of such proceeding as authorized by the board of
directors in the specific case or as authorized or required under
any provision in the articles of incorporation or bylaws or by
any applicable resolution or contract upon receipt of an
undertaking by or on behalf of the director to repay such amount
unless it shall ultimately be determined that he is entitled to
be indemnified by the corporation against such expenses.
Section 55-8-54. Court-ordered indemnification.
Unless a corporation's articles of incorporation provide
otherwise, a director of the corporation who is a party to a
proceeding may apply for indemnification to the court conducting
the proceeding or to another court of competent jurisdiction. On
receipt of an application, the court after giving any notice the
court considers necessary may order indemnification if it
determines:
(1) The director is entitled to mandatory
indemnification under G.S. 55-8-52, in which case
the court shall also order the corporation to pay
the director's reasonable expenses incurred to
obtain court-ordered indemnification; or
(2) The director is fairly and reasonably entitled to
indemnification in view of all the relevant
circumstances, whether or not he met the standard
of conduct set forth in G.S. 55-8-51 or was
adjudged liable as described in G.S. 55-8-51(d),
but if he was adjudged so liable his
indemnification is limited to reasonable expenses
incurred.
Section 55-8-55. Determination and authorization of indemnification.
(a) A corporation may not indemnify a director under
G.S. 55-8-51 unless authorized in the specific case after a
determination has been made that indemnification of the director
is permissible in the circumstances because he has met the
standard of conduct set forth in G.S. 55-8-51.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a
quorum consisting of directors not at the time
parties to the proceeding;
(2) If a quorum cannot be obtained under subdivision
(1), by majority vote of a committee duly
designated by the board of directors (in which
designation directors who are parties may
participate), consisting solely of two or more
directors not at the time parties to the
proceeding;
(3) By special legal counsel (i) selected by the board
of directors or its committee in the manner
prescribed in subdivision (1) or (2); or (ii) if a
quorum of the board of directors cannot be
obtained under subdivision (1) and a committee
cannot be designated under subdivision (2),
selected by majority vote of the full board of
directors (in which selection directors who are
parties may participate); or
(4) By the shareholders, but shares owned by or voted
under the control of directors who are at the time
parties to the proceeding may not be voted on the
determination.
(c) Authorization of indemnification and evaluation as to
reasonableness of expenses shall be made in the same manner as
the determination that indemnification is permissible, except
that if the determination is made by special legal counsel,
authorization of indemnification and evaluation as to
reasonableness of expenses shall be made by those entitled under
subsection (b)(3) to select counsel.
Section 55-8-56. Indemnification of officers, employees, and agents.
Unless a corporation's articles of incorporation provide
otherwise:
(1) An officer of the corporation is entitled to
mandatory indemnification under G.S. 55-8-52, and
is entitled to apply for court-ordered
indemnification under G.S. 55-8-54, in each case
to the same extent as a director;
(2) The corporation may indemnify and advance expenses
under this Part to an officer, employee, or agent
of the corporation to the same extent as to a
director; and
(3) A corporation may also indemnify and advance
expenses to an officer, employee, or agent who is
not a director to the extent, consistent with
public policy, that may be provided by its
articles of incorporation, bylaws, general or
specific action of its board of directors, or
contract.
Section 55-8-57. Additional indemnification and insurance.
(a) In addition to and separate and apart from the
indemnification provided for in G.S. 55-8-51, 55-8-52, 55-8-54,
55-8-55 and 55-8-56, a corporation may in its articles of
incorporation or bylaws or by contract or resolution indemnify or
agree to indemnify any one or more of its directors, officers,
employees, or agents against liability and expenses in any
proceeding (including without limitation a proceeding brought by
or on behalf of the corporation itself) arising out of their
status as such or their activities in any of the foregoing
capacities; provided, however, that a corporation may not
indemnify or agree to indemnify a person against liability or
expenses he may incur on account of his activities which were at
the time taken known or believed by him to be clearly in conflict
with the best interests of the corporation. A corporation may
likewise and to the same extent indemnify or agree to indemnify
any person who, at the request of the corporation, is or was
serving as a director, officer, partner, trustee, employee, or
agent of another foreign or domestic corporation, partnership,
joint venture, trust or other enterprise or as trustee or
administrator under an employee benefit plan. Any provision in
any articles of incorporation, bylaw, contract, or resolution
permitted under this section may include provisions for recovery
from the corporation of reasonable costs, expenses, and
attorneys' fees in connection with the enforcement of rights to
indemnification granted therein and may further include
provisions establishing reasonable procedures for determining and
enforcing the rights granted therein.
(b) The authorization, adoption, approval, or favorable
recommendation by the board of directors of a public corporation
of any provision in any articles of incorporation, bylaw,
contract or resolution, as permitted in this section, shall not
be deemed an act or corporate transaction in which a director has
a conflict of interest, and no such articles of incorporation or
bylaw provision or contract or resolution shall be void or
voidable on such grounds. The authorization, adoption, approval,
or favorable recommendation by the board of directors of a
nonpublic corporation of any provision in any articles of
incorporation, bylaw, contract or resolution, as permitted in
this section, which occurred on or prior to July 1, 1990, shall
not be deemed an act or corporate transaction in which a director
has a conflict of interest, and no such articles of
incorporation, bylaw provision, contract or resolution shall be
void or voidable on such grounds. Except as permitted in
G.S. 55-8-31, no such bylaw, contract, or resolution not adopted,
authorized, approved or ratified by shareholders shall be
effective as to claims made or liabilities asserted against any
director prior to its adoption, authorization, or approval by the
board of directors.
(c) A corporation may purchase and maintain insurance on
behalf of an individual who is or was a director, officer,
employee, or agent of the corporation, or who, while a director,
officer, employee, or agent of the corporation, is or was serving
at the request of the corporation as a director, officer,
partner, trustee, employee, or agent of another foreign or
domestic corporation, partnership, joint venture, trust, employee
benefit plan, or other enterprise, against liability asserted
against or incurred by him in that capacity or arising from his
status as a director, officer, employee, or agent, whether or not
the corporation would have power to indemnify him against the
same liability under any provision of this act.
Section 55-8-58. Application of Part.
(a) If articles of incorporation limit indemnification or
advance for expenses, indemnification and advance for expenses
are valid only to the extent consistent with the articles.
(b) This Part does not limit a corporation's power to pay
or reimburse expenses incurred by a director in connection with
his appearance as a witness in a proceeding at a time when he has
not been made a named defendant or respondent to the proceeding.
(c) This Part shall not affect rights or liabilities
arising out of acts or omissions occurring before July 1, 1990."
